California’s Strong Revenue Trends Mask Looming Budget Risk

Jan 23, 2026 - These challenges would not be short-lived either. After the dot-com bust and the Great Recession, it took four and five years, respectively, for revenues to recover. Incorporating revenue risk into the budget now, therefore, reflects prudence, not pessimism.
https://lao.ca.gov/Publications/Report/5104

The 2021-22 Budget: The Governor’s Suspension Proposal

Jan 29, 2021 - Figure 2 Programs or Augmentations Subject to Suspension and Proposed in Governor ’s Budget Program Use of Proposition  56 revenues for provider payment increases X Continued restoration of 7  percent service hour reduction X Extension of coverage for postpartum mental health X Non ‑enforcement of uniform holiday schedule
https://lao.ca.gov/Publications/Report/4328

The 2025-26 Budget: Initial Comments on the Governor's May Revision

May 17, 2025 - As we discuss later in this brief, the May Revision maintains a cost ‑of ‑living adjustment (COLA) and other spending increases for schools and community colleges despite the drop in funding. Baseline Spending Higher by $12   Billion.
https://lao.ca.gov/Publications/Report/5044

The 2022-23 Budget: Fiscal Outlook for Schools and Community Colleges

Nov 17, 2021 - The Legislature could increase funding for the community colleges by providing more unrestricted funding, more restricted funding for specified purposes, or more support directly to students to address living costs.
https://lao.ca.gov/Publications/Report/4473

The 2023-24 Budget: Considering Inflation's Effects on State Programs

Nov 16, 2022 - Cases in which program spending is adjusted by certain factors, like a cost ‑of ‑living adjustment (COLA). These factors are set and approved in state law. These adjustments require limited annual legislative input, particularly when continuously appropriated.
https://lao.ca.gov/Publications/Report/4647

New Inflation Poses Not So New Budget Risk

Dec 15, 2022 - Inflation Risk Is Really a Revenue Risk Although high inflation often is most associated with rising prices and a higher cost of living, from a state budget perspective, the overriding worry is on the revenue side.
https://lao.ca.gov/Publications/Report/4653

The 2021-22 Budget: Overview of the Spending Plan (Final Version)

Oct 27, 2021 - APS = Adult Protective Services; CFAP = California Food Access Program; Cal ‑OAR = California CalWORKs Outcomes and Accountability Review; COLA = cost ‑of ‑living adjustment; GF = General Fund; ARPA = Advanced Research Projects Administration; LCSAs = local child support agencies; FFPSA = Family First Prevention Services Act; DDS = Department of Developmental Services; MSSP=
https://lao.ca.gov/Publications/Report/4448/1

The 2021-22 Budget: Overview of the Governor's Budget

Jan 10, 2021 - Conclusion The pandemic has disrupted the lives and livelihoods of millions of Californians and continues to take the lives of thousands of Californians each month. In the spring of 2020, the Legislature faced an unprecedented challenge to respond to the pandemic and adopt a budget in the face of unprecedented economic uncertainty.
https://lao.ca.gov/Publications/Report/4309

Rethinking California's Reserve Policy

Apr 10, 2025 - A person saving for retirement does not know how long they will live or exactly what their expenses will be in retirement, but they nonetheless must plan for this eventuality by making the best possible choices in the meantime.
https://lao.ca.gov/Publications/Report/5028

The 2022-23 Budget: Multiyear Budget Outlook

May 24, 2022 - Our office ’s expenditure estimates account for inflation when cost ‑of ‑living adjustments are required by law and in areas where the state typically provides these adjustments, for example, in employee compensation.
https://lao.ca.gov/Publications/Report/4602